This study discovers the relation between corporate governance factors and earnings quality and finds that increases in dividends and foreign ownership deter earnings management. The author shows that dividend increases and foreign ownership enhance earnings quality, but they appear to be...

This study examines the role of earnings management in the relationship between firm performance and capital structure, dividing earnings management into discretionary and nondiscretionary accruals to test established theories on the capital structure. Using data on 802 companies in the member...

The present study investigates the relationship between management characteristics (managerial entrenchment, CEO narcissism, overconfidence, board effort, real and accrual-based earnings management) and the audit report readability of listed firms. In other words, this paper seeks to answer the...

In this study, we investigate whether effective corporate governance (CG) intervenes in the relationship between real earnings management (REM) and firm value (FV) by introducing Korean market data. We find that management's opportunistic REM behavior is no longer effective for firms...

The present study aims to investigate the effects of mandatory requirements of audit firm rotation on earnings management among companies listed on the Tehran Stock Exchange (TSE). The study population consists of 1030 observations and 103 companies listed on the TSE during the years 2003-2012;...

The paper aims to investigate the effects of financial distress risk (FDR) and related party transactions (RPT) on financial reporting quality (FRQ) in an emerging market called Iran. In this study, the ordinary least squares regression (OLS) method is employed to test the hypotheses; moreover,...

The phenomenon of creative accounting has attracted the attention of researchers for decades, especially in the financial sector for its implications on the quality of financial reporting. Although several procedures have been developed by researchers and practitioners to determine any...

Purpose: This study verifies the debt covenant hypothesis by exploring the earnings management of zero-leverage firms that are not constrained by debt covenants. Furthermore, this study investigates whether the earnings management of zero-leverage firms varies depending on financial constraints,...

Purpose: This study examines whether real earnings management (REM) affects firm value by introducing quarterly financial data in the Korean market. Design/methodology/approach: The study employed four REM metrics as independent variables, and Tobin's Q as dependent variable. Ordinary...

This study investigates the relation between common institutional ownership along the supply chain and earnings management by supplier firms. Using a sample of U.S. publicly traded firms for the period of 1980–2016, we find that common ownership along the supply chain reduces the level of a...

This paper examines the determinants of bank income smoothing using loan loss provisions in the United Kingdom or Great Britain from 1999 to 2017. The findings show that UK banks use loan loss provision for income smoothing purposes. Income smoothing is greater in times of high economic policy...

The main function behind the conceptualization of creative accounting is maintaining the quality of financial reporting practice. This phenomenon has attracted the attention of researchers for decades, especially in the banking sector, concerning its wide implications and indications for...

Creative accounting is considered to be a 21st-century phenomenon that has received increased attention after the worldwide economic crisis and budget deficits, particularly the prevention and detection of accounting manipulation. Creative accounting is a practice that influences financial...

Managers are often employed many alternatives for earnings management following their objectives or the financial reporting objectives; the commonly used are the accrual-based and cash-based earnings management. The literature reveals that managers adopt the two strategies in different ways,...

Purpose: The purpose of this study investigates the role of directors and officers (D&O) insurance and restatement announcements in earnings management strategies. Design/methodology/approach: Using data on Taiwan's capital market, we implement two-stage method regression to examine the effects...

We examine whether analysts’ engagement in earnings conference calls curbs real activities earnings management. We find that analysts are more likely to ask questions on discretionary expenses at conference calls of firms that are suspects of lowering discretionary expenses to meet or narrowly...

Although the literature has explored an association between corporate social responsibility (CSR) disclosure and accounting conservatism, this paper investigates how state ownership moderates this relationship in the context of the emerging Russian economy. Based on a sample of 223 publicly...

Prior research documents positive effects of PCAOB oversight on reporting and audit quality. However, to gain a clear understanding of the net benefits of regulation, it is important to also investigate corresponding costs. To this end, we investigate the relation between PCAOB inspection...

This study combines the concept of a fraud triangle and a modified M-score in order to detect factors that trigger earnings management. The modified M-score formula contains 5 original ratios and 4 additional ratios. The sample used was 284 manufacturing companies listed on the IDX in 2017-2019....

This research aims to develop a determinant variable of the Sukuk rating derived from agency and asymmetry theories. This research is essential because Sukuk or Islamic Bonds is needed in Indonesia, with 85% of its population out of 320 million people being Muslim. Many studies on the...

The purpose of this study is to examine the influence of earnings management on the readability of annual reports while also examining the moderating role of a female director. In particular, the readability of a company's annual report will be seen from the management perspective using the FOG...

This paper aims to investigate the effect of audit committee ethnicity, as part of the diverse cultures in Malaysia, on analysts' forecast accuracy. In addition, this study investigates further the interactions between the unique cultures in Malaysia and earnings management to determine whether...

An extensive literature examines whether senior executives’ contractual incentives influence their financial reporting decisions. However, little is known about whether— and how—the incentives of lower-level (or “rank-and-file”) employees, who are perhaps even more directly involved in...

In this study, we examine the effects of lead independent directors (LIDs) on firms’ earnings management. Based on US firms from 2000–2016, those with LIDs managed earnings less as reflected by the absolute value of discretionary accruals. We further propose several economic channels that...

This paper investigates the relationship between the audit committee’s cash compensation and accrual earnings management. Using a sample of Chinese listed firms over the period 2007 to 2017, findings show a positive association between cash compensation of the audit committee and accrual...

The Australian not-for-profit and charitable sector is an important component in that country’s social capital. It delivers services and supports to some of the most vulnerable people in the community. However, up until recently, poor data sets related to the sector’s financial performance...

We study the links between conditional conservatism and voluntary disclosure of management private information. We argue that conditional conservatism acts as a mechanism that lends credibility to voluntary disclosure by providing a hard reporting benchmark that allows outsiders to better...

This research aims to look at how firm characteristics and audit quality can affect the earning management practices in the Egyptian context, within the period of 2011–2019. This period was after the Egyptian revolution and has not been well investigated in Egypt, especially after the new...

This paper investigates the relationship between bank debt and earnings management in private SMEs in a bank-oriented economy. In this study, we leverage a sample of 4866 Italian private SMEs from 2005 to 2012 and propose a new metric to isolate the annual increase in bank debt. The results of...

This study provides empirical proof that the positive impact of high accrual quality is the ability to accurately predict the future return with a positive sign. In the capital market, better prospects are commonly indicated by regularly and routinely implementing a high-yield dividend policy....

Financial managers intentionally use the legal manipulation of earnings to the business development. Earnings management is a widespread business finance phenomenon. The approaches and the ways of this practice are marked by many parallels. The main target of the article is to show the clusters...

Organizations are formed to gain long-term benefits. However, sometimes myopic management for feigned value enhancement led to the early demise of the firm. Further, to the best of our knowledge empirical role of financing constraints has not yet been explored between the relationship of...

Using a standard partial adjustment model and US firms, we study the relationship between managers' failure to achieve target labor productivity and their tendency to manage earnings. To overcome the endogeneity problem, we employ an instrumental variable technique based on negative investment...